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Is Capitalism Moral?

Reflections on the Schweickart-Brook Debate

Professor Schweickart (far left) learns the hard way that "Objectivsts" are objectively insane

Professor Schweickart (far left) learns the hard way that it’s impossible to engage in mature debate with apostles of Ayn Rand’s “Objectivist” cult.

On March 17th the Loyola Student Objectivist Society hosted a debate between David Schweickart and Yaron Brook. Schweickart, a professor of philosophy associated with the analytical Marxist tradition, is a leading authority on the subject of market socialism[1] and, as one would predict given this background, argued that capitalism is an immoral method of organizing production. Brook, executive director of the Ayn Rand Institute, was true to his institution’s namesake and defended capitalism as the very pinnacle of morality. I recently had an opportunity to watch the debate and have decided to write a commentary on the spectacle.

Before getting into the specifics of the debate, however, I would like to briefly examine the ethical theories espoused by Karl Marx and Ayn Rand. Though it may invoke shock and horror among Marxists and Objectivists alike, both thinkers were influenced by Aristotle to a considerable extent;[2] but it will come as no surprise that their respective conceptions of eudaimonia were at variance with one another. With that said, there is vast and contentious literature on Marx’s relationship to moral philosophy, but within it there are basically three schools of thought: (1) essential unity theory, (2) rupture theory, and (3) developmental theory. The first school claims that there is a continuous harmony between Marx’s early humanist writings (e.g., the Economic and Philosophic Manuscripts of 1844) and his mature scientific work (e.g., Das Kapital) with respect to the question of ethics. The second school, by contrast, argues that Marx severs all ties with matters of normative philosophy by the publication of The German Ideology in 1846, therewith adopting a reductionist theory of human action entirely divorced from matters of justice. The third school is in agreement with essential unity theorists concerning Marx’s lifelong humanism, but accepts that Marx had come to reject the concept of human nature that animated his early writings. Personally, I find the developmental theorist’s exegesis the most persuasive among the contending schools of thought.

For the purposes of this post, I will focus primarily upon Marx’s early moral philosophy because I happen to find a great deal of value in it. Simply put, it can be characterized as a synthesis of Aristotelian and Kantian ethics. From the former, Marx adopted the concept of human essence—which he took to be fundamentally social[3]—and from the latter he adopted the notion of a universal categorical imperative. Though some might find these moral doctrines irreconcilable, in the following passage Philip Kain aptly explains why Marx was not necessarily mistaken for considering them mutually compatible:

A moral theorist who holds a deontological theory of obligation need not reject a theory of the good. In fact, the theory of the highest good plays an important role in Kant’s ethics. The highest good involves happiness as well as morality. Happiness is certainly an end or good to be sought. A life without happiness would not be the highest good; thus to achieve the highest good we must seek happiness. But our moral obligation demands that the desire for happiness not determine our moral action; the categorical imperative alone must do that. The highest good is thus attainable only if God or history manipulates nature such that happiness accompanies morality. So also, for Marx, the realization of species’ essence can be called the highest good. But this good alone does not determine our obligation. The principle of universalization is a necessary component in determining our moral obligation and allowing us to be free.[4]

Thus, for the young Marx, capitalism not only alienates us from our communal Gattungswesen, but the very practice of wage labor upon which the system is based additionally treats human beings as commodities, i.e., as mere means to accumulate capital, thereby egregiously violating the categorical imperative.[5] Only under communist social relations can man lead a truly fulfilling and dignified existence. This is, of course, the converse of Ayn Rand’s view. She rejected Immanuel Kant’s categorical imperative as one of the most destructive moral theories ever devised,[6] and, according to her vapid theory of human nature, man is only in his element when free to amass commodities without public restraint.

I do not intend on demonstrating the superiority of Marx’s political philosophy vis-à-vis Rand’s here,[7] I only wanted to juxtapose their positions for the sake of uninitiated readers.

Returning to the debate, I should perhaps begin by mentioning that, although it was his first formal debate, Schweickart performed quite admirably. None of what is to follow is intended to be insulting towards him, it should instead be interpreted as constructive criticism. Brook, being a spokesman for Ayn Rand’s pseudo-philosophy, has a substantial amount of experience in public relations, and hence was simply better able to convey his case to the Loyola University-Chicago audience. (But it should be noted that the house was so stacked against Schweickart that heckles from the Objectivist nitwits who organized the event are audible whenever he finishes speaking in the video. Also, the moderator frequently allowed Brook to have the last word on numerous exchanges, which gave him an unfair advantage.) Brook’s delivery was sloppy and often immature, but the zeal with which he spoke of bourgeois principles most likely won over whatever undecided individuals existed in the audience. Schweickart’s cerebral arguments and his reserved tone may yield positive results among fellow academicians, but he was confronted with a crowd reared in our machismo pop culture wherein whoever is the loudest and exudes the most confidence in a dispute is commonly regarded as the winner, and he should have modified his presentation accordingly.

Rather than try to persuade the audience of the merits of Ayn Rand’s vacuous “rational egoist” philosophy—a Herculean task even for the most charismatic defenders of the faith—Brook decided to frame the debate in terms of coercion versus freedom. This is a clever tactic reactionaries utilize when debating leftists because it enables them to blame all of the maladies regularly associated with actually existing capitalism on “statism,” while appearing to take the moral high ground by accusing socialists of seeking to infringe upon one’s autonomy or “self-ownership.” This is precisely where Schweickart should have explained the differences between formal self-ownership and effective personal autonomy. The non-aggression principle which follows from the theory of self-ownership is not violated under socialism,[8] and even if it were, self-ownership is not axiomatically self-evident,[9] so whatever benefits ensue from violating the alleged principle would need to be taken into account before casting judgement.[10] Moreover, of the two systems, democratic socialism allows far greater scope for personal autonomy because the practice of workers’ self-management it endorses grants everyone the ability to participate in the decisions that intimately affect their lives (e.g., what is going to be produced, how it is going to be produced, and the manner by which the joint product is to be allocated). Reactionaries may retort that this can only be realized at the cost of prohibiting “capitalist acts between consenting adults,” and that workers already have the freedom to become their own bosses. In such cases, socialists should respond by mentioning the following: (1) the nature of the credit rationing system under capitalism is such that the asset-poor in society are systematically denied an equal opportunity to capitalize on entrepreneurial discoveries,[11] and (2) affording individual workers the luxury to become capitalists themselves structurally requires there be a large class of disadvantaged people readily available to exploit as wage laborers.[12]

Which brings me to my next criticism. It is rather odd that in a debate concerning the morality of capitalism the question of the exploitation of man by man was conspicuously absent. The charge of exploitation has been socialism’s greatest ethical challenge to capitalism since its inception, and there was a time in Schweickart’s own career when he was attempting to develop what he called a “democratic theory of exploitation”[13]—which was to incorporate facets of Karl Marx’s and John Roemer’s respective theories of exploitation—but it appears as though he has abandoned that project. Perhaps he came to agree with Roemer that Marxists should focus their criticisms of capitalism elsewhere.[14] Whatever the case may be, Nicholas Vrousalis has recently presented a compelling argument that Marxists are justified in accusing capitalism of being an exploitative mode of production. He does so by defining exploitation in terms of domination for self-enrichment, as opposed to Roemer’s “exchange against the background of injustice in the distribution of assets” or Marx’s labor theory of value.[15] Vrousalis also demonstrates that the only conceivable way to abolish exploitation (i.e., the instrumentalization of someone’s relative economic vulnerability for the appropriation of his or her labor) is by collectivizing the means of production and implementing a policy of workers’ self-management.[16]

Surely Schweickart could have fared better in the debate had he been able to cite exploitation as the sole source of capitalist profit—which, I would argue, is intuitively obvious to large segments of society. I suspect one of the reasons he neglected the issue is because his market socialist model allows ample space for the continuation of the practice. Indeed, not only did Schweickart fully concede that “Mises and Hayek were right” about the insurmountable obstacles that allegedly doom any attempt to comprehensively plan a complex economy to failure, but he even claimed that inequalities derived from capitalist entrepreneurship are permissible under his model. The explanations he provides for his defense of competitive markets and “entrepreneurial capitalists” are utilitarian, in that he believes they are indispensable factors in sustaining a sufficiently dynamic economic system, but in so doing he slips into idealism and cedes too much ground to his conservative opponents by agreeing with their ideological assumptions. With respect to the utilitarian concern, David Kotz has done an extensive amount of research which, in my opinion, indicates that neither markets nor bourgeois entrepreneurs are required for rapid innovation and economic dynamism,[17] and Daniel Pink has compiled evidence revealing the many negative consequences which often stem from conventional monetary incentive structures.[18] As for my accusation of idealism, I believe Schweickart is being incredibly naïve to think his socialist market economy could withstand the class tensions that would inevitably emerge between the wealthy entrepreneurial capitalist sector and the working class cooperative sector. Being that he is a Marxist, he should understand why.

During the debate Schweickart frequently claimed his market socialist system would be considerably more egalitarian than any form of capitalism is capable of being, and made much ado about the fact that political democracy is undermined by the inequality capitalism engenders. Since Objectivists are elitist minarchists, this phenomenon obviously does not trouble men like Brook, and he took the occasion to employ another popular reactionary strategy: conflating ochlocracy with democracy. Those who use this straw man argument basically claim that anyone who favors democracy is a mindless advocate of “mob rule,” and, in order to be consistently democratic, they would have to support virtually any decision (even the most abhorrent ones, such as rape or genocide) as long as it was consented to by a majority. In response, Schweickart should have stated that democracy is a method for achieving self-governance, i.e., allowing people to participate in decisions in proportion to the degree they are affected by the outcome, not an indiscriminate extolment of majorities. Despite his indignation at capitalism’s corruption of democracy, however, it is not clear how Schweickart’s model would prevent wealthy entrepreneurs from also taking advantage of rent-seeking politicians. Of course, Brook is equally naïve for thinking corporations within his ideal laissez-faire economy would abstain from colluding to establish a government large enough to continue providing them with the welfare privileges they currently enjoy (periodic bailouts, state funded research and development, etc.), and for believing that a market economy could even function without a heavily intervening state apparatus.

Now, this may be somewhat of a trivial point, but during one of their exchanges Brook compared Schweickart’s market socialist proposal with the Israeli kibbutzim and claimed the latter were a dismal failure, thereby suggesting there is reason to suspect market socialism would be as well. And while Schweickart was correct in saying his model is not analogous to the kibbutzim, I think he should have challenged the empirical validity of Brook’s statement nonetheless. A brief glance through the literature reveals that there are currently 256 kibbutzim in Israel with approximately 106,000 individuals residing within them—figures hardly indicative of failure.[19] There was, in fact, a crisis that occurred within the kibbutz movement during the credit squeeze of the mid 1980s, but that affected the entire Israeli economy, and in the decades preceding said crisis the kibbutzim were regarded as successful and efficient by most impartial analysts. The restructuring some of the kibbutzim have undergone since then can largely be attributed to the ideological contamination that has transpired as a result of Israeli citizens reared in the capitalist sector being granted permission to live on kibbutz property, and to the fact the welfare state that helped support life for many kibbutzniks has been dismantled. Suffice it to say, it is difficult to sustain a communist ethos when communities are faced with such circumstances.[20]

Despite 2/3 of kibbutzim transforming from communistic societies to more individualistic market socialist communities, the kibbutz movement continues to thrive.

Although 2/3 of the kibbutzim have transformed from being relatively communistic to more market-orientated socialist communities, the kibbutz movement continues to thrive in Israel.

Finally, I think a useful way for Schweickart to have illustrated the immorality of capitalism would have been for him to contrast the possessive individualism and unfair outcomes it generates with the socialist vision of man attaining self-realization in labor. By providing publicly subsidized higher education, health care, and basic housing to the masses—in conjunction with collectivizing the means of production—a socialist commonwealth would create an environment in which everyone possesses a comparable opportunity to develop their capacities, while the distributive inequities that follow from brute luck are mitigated. This return to the young Marx’s conception of the good life has an attractive quality which I think would resonate with people.[21]

I realize that time constraints and the format of the debate probably prevented Schweickart from being able to get into some of these subjects, but hopefully this post can serve as a guide for other socialists preparing to debate this topic.

[1] Schweickart’s Capitalism or Worker Control?: An Ethical and Economic Appraisal (New York: Praeger Publishers, 1980) and Against Capitalism (Cambridge: Cambridge University Press, 1993) were instrumental texts in my development as a socialist. I continue to believe that something like the market socialist model he advocates is the most likely successor-system (to borrow Schweickart’s phrase) to capitalism, but no longer consider it a desirable end point. The market itself must be transcended if humanity is to achieve a world free of exploitation and alienation.
[2] Indeed, Rand would often remark that Aristotle was the only philosopher who ever influenced her work—though the mark of Nietzsche is ever visible in her writings.
[3] And naturalists as diverse in political and evolutionary opinion as Richard Lewontin and Matt Ridley would, for the most part, agree. The best exposition on the subject remains Peter Kropotkin’s Mutual Aid: A Factor of Evolution (New York: New York University Press, 1972); originally published 1902.
[4] Philip J. Kain, Marx and Ethics (Oxford: Oxford University Press, 1991), pp. 74-75.
[5] Even after Marx abandoned the idea of a static human nature and began to question the usefulness of abstract moral principles, his conception of the good life remained Aristotelian in the sense that he envisaged communism as consisting of individuals flourishing by realizing their historically-bred capacities.
[6] For example, in Philosophy: Who Needs It (New York: Signet Books, 1984), p. 98, Rand writes: “The widespread fear and/or resentment of morality—the feeling that morality is an enemy, a musty realm of suffering and senseless boredom—is not the product of mystic, ascetic or Christian codes as such, but a monument to the ugliest repository of hatred for life, man and reason: the soul of Immanuel Kant.”
[7] That may be the subject of a paper I write in the months ahead, however.
[8] Provided self-ownership is conjoined with common ownership of the world (as opposed to Lockean individual appropriation of land) and the hypothetical socialist constitution contains a provision permitting everyone the liberty to opt-out of collaborative work arrangements. See Nicholas Vrousalis, “Libertarian Socialism: A Better Reconciliation between Self-Ownership and Equality,” Social Theory and Practice, Vol. 37, pp. 211-226 (2011).
[9] Kasper Lippert-Rasmussen makes a cogent argument against the self-ownership thesis in “Against Self-Ownership: There Are No Fact-Insensitive Ownership Rights over One’s Body,” Philosophy & Public Affairs, Vol. 36, No. 1, pp. 86–118 (Winter 2008).
[10] G. A. Cohen believed that the self-ownership thesis was essentially irrefutable but that its appeal could be significantly diminished by closely examining its ethical implications. See Self-Ownership, Freedom, and Equality (Cambridge: Cambridge University Press, 1995), Ch. 10.
[11] Theodore Burczak, “A Critique of Kirzner’s Finders-Keepers Defense of Profit,” The Review of Austrian Economics, Vol. 15, No. 1, pp. 75-90 (2002).
[12] G. A. Cohen, “The Structure of Proletarian Unfreedom,” Philosophy & Public Affairs, Vol. 12, No. 1, pp. 3-33 (Winter 1983).
[13] David Schweickart, “A Democratic Theory of Economic Exploitation Dialectically Developed,” in R. Gottleib (ed.), Radical Philosophy, Tradition, Counter-Tradition, Politics (Philadelphia: Temple University Press, 1993), pp. 101-122.
[14] John Roemer, “Should Marxists be Interested in Exploitation?,” Philosophy & Public Affairs, Vol. 14, No. I, pp. 30-65 (Winter 1985).
[15] Although I believe the labor theory of value has been empirically validated—see, for example, Dave Zachariah, “Labour Value and Equalisation of Profit Rates: A Multi-Country Study,” Indian Development Review, Vol. 4, pp. 1-21 (2006)—I do not think it qualifies as an adequate theory of exploitation, since all that could follow from acknowledging its validity is that workers should receive the undiminished proceeds of their labor. Redistributive taxation, which is a necessary action for securing social justice, could not be justified on such a basis. G. A. Cohen provides additional criticisms of the labor theory of value’s use as a theory of exploitation in “The Labor Theory of Value and the Concept of Exploitation,” Philosophy & Public Affairs, Vol. 8, No. 4, pp. 338-360 (Summer 1979).
[16] Nicholas Vrousalis, “Exploitation, Vulnerability, and Social Domination,” forthcoming in Philosophy & Public Affairs (2013).
[17] David M. Kotz, “Socialism and Innovation,” Science & Society, Vol. 66, No. 1, pp. 94-108 (Spring 2002).
[18] Daniel H. Pink, Drive: The Surprising Truth About What Motivates Us (New York: Riverhead Books, 2011).
[19] Avraham Pavin, “The Kibbutz Movement: Facts and Figures” (Ramat Efal: Yad Tabenkin-Research and Documentation Center of the Kibbutz Movement, 2006).
[20] See Uri Zilbersheid, “The Israeli Kibbutz: From Utopia to Dystopia,” Critique, Vol. 35, No. 3, pp. 413-434 (Winter 2007).
[21] Jon Elster provides an excellent case for this position in “Self-realisation in Work and Politics: The Marxist Conception of the Good Life,” in Elster and Moene (eds.), Alternatives to Capitalism (Cambridge: Cambridge University Press, 1989), pp. 127-159. Michael Lebowitz also develops the idea in The Socialist Alternative: Real Human Development (New York: Monthly Review Press, 2010).


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3 thoughts on “Is Capitalism Moral?

  1. Pingback: John Galt’s Modest Proposal | COMMON RUIN

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